Suppose You Received a 5 Percent Increase in Your Nominal

question 14

Multiple Choice

Suppose you received a 5 percent increase in your nominal wage.Over the year,inflation ran about 2 percent.Which of the following is true?

• A)Your real wage increased.
• B)Your nominal wage decreased.
• C)Both your nominal and real wages decreased.
• D)Although your nominal wage fell,your real wage increased.
• E)Although your nominal wage rose,your real wage decreased.

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Definitions:

Instincts

In Freud’s system, mental representations of internal stimuli, such as hunger, that drive a person to take certain actions.

Conscious

The state of being aware of and able to think about one's own thoughts, feelings, and perceptions.

Psychic Energy

A concept in psychoanalysis that describes the energy derived from instinctual drives and instincts, influencing and driving human behavior.

Cathexis

An investment of psychic energy in an object or person.